Superintendent, teachers union debate use of health care surplus

Joe Burris, The Baltimore Sun

When first-year Superintendent Renee Foose presented her first operating budget for Howard County public schools, she lauded the proposal as being just a $7 million increase over last year's budget and said it meets the primary objective of protecting the classroom with no furloughs or decreases to staff.

The $721.1 million plan also addresses such concerns as a new elementary school, accommodating 550 new students throughout the system and implementing several program enhancements.

Yet Foose's budget was unveiled at the same time the school system has been in negotiations with the Howard County Education Association, the union representing those who teach in the classrooms.

And at times, those talks haven't gone smoothly.

That was evident during a recent school board meeting, when the teachers union president, Paul Lemle, voiced concern about the budget, specifically as it relates to health care fund contributions for employees.

The school system, Lemle said, has in recent years carried a $1 million surplus in the employee health care general fund, and added, "For the previous three years, the school system has spent annual surpluses in the health care fund to artificially lower the general fund contribution."

Lemle said the $15.5 million increase in employee health benefits in Foose's budget proposal "is a result of spending surpluses for the past several years."

"Employee contributions have doubled since 2008 and are rising about 10 percent a year," he said. "The school system is using the employees' money without consideration or participation when it withheld too much."

On Tuesday, Foose said the school system maintains a fund balance "because it is responsible for the risk of higher-than-anticipated health care bills."

"We're self-insured, so we assume the risk, not employees," she said. "And although the employees have a valid interest in the maintenance of a sufficient fund balance, it is the responsibility of the school system to ensure funds are available to meet future obligations."

She also said employee medical premiums are based on data from consultants.

"We have all the supportive documentation that supports the accuracy of the rates for employees. I'm certainly open to greater communication with the unions to discuss the health care contribution, although I do want to say that this issue — premium cost — is not a negotiated issue. What is negotiated is the percentage of the medical premium that is the employee's responsibility.

"Currently, employees play between 13 and 15 percent of these premiums," she said, "with the system paying the remaining 85 to 87 percent."

Foose said that she has "gone out of my way to collaborate on many levels with HCEA," but added that the issues Lemle raised about health care during the board meeting was her first time hearing about such concerns.

"It was not brought up in item meetings I had with Mr. Lemle prior to that."

On Wednesday, Lemle acknowledged that he had not brought it up with Foose before the board meeting and added, "I wanted there to be an awareness … that I couldn't possibly have achieved in a one-on-one conversation."

Lemle said that the school system carries stop-loss insurance against "unanticipated costs or catastrophic claims costs," and added, as the contribution rate to the health care is contractual, "how is saying we're paying too much not contractual?

"Say we had a $100 million agreement; you're paying $85 million and I'm paying $15 million," Lemle said. "If, at the end of the year, there's $5 million left over, you as the employer say, 'Aha, I only have to pay $80 million because there's $5 million left over.'

"But we are stuck paying $15 million again," he said. "My claim is that [the surplus] should reduce my contribution."